Does it make sense to hire sales managers from outside your industry?

There are two schools of thought when it comes to hiring sales managers:

One is that skills are universal and transferable. If you know how to successfully lead and motivate a sales team, it doesn’t much matter whether you have industry-specific experience. Sales management is sales management.

The other is that sales management skills are industry-specific. If you’re in the medical device business and you need to hire a sales manager, you’d better stick with candidates who’ve sold medical devices before.

According to a recent study, most recruiters subscribe to the second school of thought. In fact, they insist on industry experience more than any other qualification. Research published by the sales and CRM review firm Software Advice found that the majority of recruiters (72%) are looking for sales director candidates who have remained in a single vertical for 5-6 years, versus 55% who are looking for someone with a management background.

Industry knowledge vs. management knowledge

Think about that for a moment. It means recruiters place a higher premium on knowing the industry than on knowing how to manage salespeople. That seems odd to me.

Of course sales managers need both kinds of knowledge. But industry knowledge is relatively easy to develop. After all, the new sales manager will be coming into an organization that’s chock full of it. There are plenty of people who can teach the ins and outs of selling medical devices or ball bearings or accounting software.

But sales management skills are something different. If the new sales manager has never motivated a team, designed a compensation plan or forecast sales, who will teach him or her? And a stellar track record as a salesperson doesn’t mean the candidate will have any success as a sales manager. They’re two different jobs. (In fact, the qualities that make someone a sales star can be disastrous in a manager.)

What’s the takeaway?
This study offer some lessons for sales managers, salespeople and recruiters:

For sales managers and salespeople: Find a company and industry you can stick with — ideally, look for an employer that offers advancement opportunities and training. Says Jay Ivey, Sales and CRM Market Research Associate at Software Advice: “Our data indicates that ambitious sales professionals should think very carefully before switching between sales jobs across different industries. Yes, if the pay is significantly higher, or if a promotion is on the table, it may be enticing to move from an insurance company to a SaaS company–just as an example. But our research indicates that If you want to take on the role of sales director in the not too distant future, jumping around probably isn’t the best choice in the eyes of a recruiter.”

And if you are looking to switch industries, you might have to look for a more creative way to get in the door and make your case. Especially with modern-day automated recruiting systems, your resume may not get past the filters and in front of actual eyeballs in the head of an actual recruiter. So you’ll need to network your way in or find some other way to bypass the filters.

Here’s where it gets interesting, though. If you do get past the filters and can get somebody to at least consider you, you may be in a pretty good spot. Because those same filters that keep you out can lead to pretty slim pickins for recruiters. I’ve blogged before about author and Wharton professor Peter Cappelli. He cites an example of an automated screening process that examined 25,000 applications for a standard engineering job and concluded that none were qualified. Obviously some of those candidates must have been able to do the job, and if any of them had figured out away around the screens, they would’ve had an open field.

The takeaway for recruiters and hiring companies is the flip side of this same argument. If you’re using industry experience as a must-have hiring criterion for sales managers, you could end up fishing in a very small pool. You’ll essentially be looking to recruit from your competitors, and seeing the same names coming again and again.

Even more problematic, many candidates will already have a job that’s equivalent to the one you’re looking to fill, and probably getting the same money you want to pay. So why would they want to switch? You’d have to worry that it’s because things aren’t going so well where they are. If it were me, I’d also like to hear from candidates who have a better reason to switch — perhaps because they’re working in a declining market, or because they think their skills would be better suited to the kinds of customers you serve.

It may seem like a safe bet to insist on industry experience. But it may not be so safe if it means you’re overlooking great candidates and just talking to the usual suspects.

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